Who are the 'game subscription' believers & non-believers?

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[The GameDiscoverCo game discovery newsletter is written by ‘how people find your game’ expert & GameDiscoverCo founder Simon Carless, and is a regular look at how people discover and buy video games in the 2020s.]

This GameDiscoverCo newsletter is very much a story of two halves. On the one hand, I thought we’d take the opportunity of Ubisoft rolling out its Ubisoft+ service to Amazon Luna to take a look at what some big publishers think of the Netflix-style premium game subscription thing.

On the other… why not look at Itch.io, the alternative Steam PWYW-ish game download site, as loved by tiny indies? We’re nothing if not broad in scope here. Let’s go:

Where is this big publisher on subs - ‘hot or not’?

So, with the announcement that Ubisoft+ is now available on Amazon Luna (for private beta users!), the premium game sub wars continue to stride forward, Terminator-style. Specifically: “Ubisoft+ subscribers in the US with access to Amazon Luna can use their subscription to play select Ubisoft games on the streaming service, including Assassin’s Creed Valhalla. In addition to multi-platform access, a standard $14.99 Ubisoft+ subscription grants access growing library of over 100 games on PC, and that includes premium editions of games and additional content packs.”

What’s more, “…by the end of the year, Ubisoft+ subscribers will also have access to select Ubisoft games on Stadia during a beta period, with no Stadia Pro subscription required. By linking accounts, subscribers will also enable full cross-progression support for games like Assassin’s Creed Valhalla across all platforms.”

So this shows Ubisoft getting further into the big publisher-specific ‘we have a deep catalog’ model. And it makes some sense to the player, if you consider Assassin’s Creed Valhalla comes with a $60 standard edition, a $100 ‘season pass’ Gold edition, and a $120 Ultimate edition.

So you only need to be buying two Gold editions a year to find Ubisoft+ potentially interesting. And Ubisoft is less keen on the mobile F2P space, culturally. So it’s still pushing hefty/expanded versions of large AAA PC and console games - with some IAP/DLC - as its core model. Finally, the ‘play on PC or cloud stream via multiple services’ is a smart angle…

Luckily, it’s ‘financial earnings’ season (woo!) at some other large game publishers. So let’s see how enthusiastic they are about the idea of launching an own-branded PC/console game catalog subscription service, from most to least:

Electronic Arts is so hot on it that they’ve actually done it! EA Play is fragmented because it’s on multiple console platforms and Steam, as well as Origin, without a common login or saves. EA as a whole has a lot of other irons in the fire - FIFA Ultimate Team, lots of high-grossing mobile F2P titles, but they are paying some attention to this space.

But in the recent EA earnings call, CEO Andrew Wilson did note: “We've reached more than 6.5 million paid subscribers. EA PLAY is now set to go live on Microsoft Game Pass in a few days [bundled with Game Pass Ultimate], and we believe we have the opportunity to double our subscriber base over the next 12 month.”

And EA’s COO/CFO Blake Jorgensen, when asked about the Microsoft hookup by an analyst, said: “We thought it was a great opportunity and there's a positive economic impact on that. When it comes to giving guidance next year, we probably still won't give detail because it's not that big of an overall business… we're in the very early days of the industry on subscriptions for games.”

Activision Blizzard doesn’t sound like it’s immediately jumping that way, partly because it has a lot of F2P mobile business, IAP, and some big subscriptions in the Blizzard camp anyhow. On October 29th, Activision Blizzard COO Daniel Alegre said this, responding to an analyst about subscriptions on the earnings call:

“We're also very fortunate in that we have exposure to every gaming business model at scale. We operate the largest subscription franchise in the industry in World of Warcraft… And we already have deep digital relationships with our players including through Battle.net which gives us just a lot of potential in this area.”

So.. a slight hint that the company could do something with Battle.net, but no immediate plans? (The Battle.net store page has a good mix of F2P, subs, DLC, and IAP within just a few big titles anyhow. So does a Battle.net sub even make sense?)

Finally and most negatively, Take-Two president Karl Slatoff said this about the premium subscription route on the company’s November 5th earnings call: “We're highly skeptical that subscriptions will be the only way or the primary way that interactive entertainment is distributed. And that's because of the way people consume it. And the price point for owning a [paid-for premium] title… is very reasonable and very, very low, actually, on a per hour basis.

Subscriptions can play a role in delivering catalogue. We've supported numerous… subscription offerings with catalog titles, I imagine we'll continue to do so. And in any case, at the end of the day, the consumer will decide, and we will be where the consumer is.”

So where does that leave us? Some really, really big game companies (EA, Ubisoft) are getting into the ‘premium branded monthly game subscription’ space, despite the fact it doesn’t make a lot of money (yet).

This is - I would think - because they want to establish their own-branded subscription ‘channel’, and are hedging against large platforms like Microsoft or the new cloud platforms taking all the power. (And also, subscription revenue is highly valued by investors!)

Others like Take-Two are very much in the ‘we’ll opportunistically take money for catalog games, but we’re not sure it’s a good business model, compared to getting $ off Grand Theft Auto Online players via IAP’ camp. Which, reader, it probably isn’t. And their point about ‘per-hour value’ for games at existing prices is fair, no matter how you slice it.

The big question is - for those of you making small and medium sized ‘buy once’ games, where do you fit in? If you don’t have a GTA Online or FIFA Ultimate level of size, differentiation or monetization, will game subscriptions start to colonize and monopolize the middle of the market? With all those implied lower costs per hour of gameplay? I don’t know - but let’s watch it closely.

What’s Itch.io like as a game platform?

Much of our time in this newsletter is spent discussing the dominant PC game platform, Steam. This can get a bit boring after a while, right? How about the other platforms like the Epic Games Store, GOG, or Itch.io?

Well, we’ll leave those other two to a later date. (Spoiler: getting on EGS is always worth it; GOG is more incremental $.) But let’s look at what and how you can sell on Itch.io. It’s an amazing, transparent website platform (and client) which makes free and ‘pay what you want’ models easy, and also allows browser-embeddable (free) games.

Fascinatingly, pay what you want even extends to paying the platform: “Since March 2015, itch.io has an open revenue sharing model. Sellers can now apply the pay what you want model towards itch.io: the revenue split between the seller and itch.io is configurable by the seller. Set it to 10%, 30%, or even 0%.”

In general, most of the games you see on Itch are smaller hobbyist and game jam titles - many of them pretty delightful. Randomly picking from the front page, The Fastest Skeleton looks super cute:

But let’s look at how more complex games do, too. In the incredibly comprehensive postmortem of an Itch-only PWYW (pay what you want) bee-themed management simulator called Hive Time, the creator notes: “In July [2020].. Hive Time hit that 500 sale point [at an average of $9.15 per sale]… unfortunately, that only amounts to a 1.36% sales conversion rate [from just over 40,000 downloads], rather than the 10% I was anticipating.”

Hive Time is a high quality and more-discussed game on Itch, and I think these download numbers are on the higher end for the platform (except Among Us, which is a long-time Itch staple.) But Itch.io’s reach seems to be less as a platform that people use daily, and more as a ‘download page’ for people to go directly to and download/pay for games.

Interestingly, the creator of Hive Time claims: “Dominant discourse holds that by not being on Steam, I'm limiting my audience significantly. Since I've gotten more players than I projected, that doesn't feel like it needs to be a critical concern. My impression… is that most people who take the time to ask whether the game will be on Steam end up buying on Itch once they understand that it won't be.”

It depends on whether you want free audience or paying audience, I guess. For some premium (paid only) games I’ve personally seen for sale on both Itch and Steam, Steam outperforms Itch sales-wise by 50-100x. So I do think the Hive Time dev has limited his revenue, if not his audience.

But going Itch-only for personal or ease of use reasons can make a lot of sense for hobbyists - if you don’t dig Valve or its cut, don’t want to have to pay $100 to publish, want to use PWYW, or just want people to easily check out the game. There’s lots more info on Itch play/download stats via this thread from ZephyrRaine on Twitter.

Perhaps you’re thinking, over there in your actual (home) office with your actual job - why cover Itch at all in this ‘professional’ newsletter? Well, I think it’s super important for us all to understand that there’s a mass of games out there, on a mass of different download platforms.

You’re competing with the 250 new PC games per week on Steam, but also with a teeming mass of games from amateurs and semi-professionals on Itch. And there’s not a lack of games in the market - your game that cost $500k isn’t guaranteed to make $500k back eventually, just because it’s on Steam.

In fact, you may be competing - indirectly or directly - against both small lakes of Steam games, but also these oceans of Itch games, generally made with sweat equity ($0) and grossing $0-$50,000. So please look at Itch for context too. But know that creatively, there’s all kinds of wonderful goodness/weirdness out there - on Itch and beyond! And that’s kinda great.

And finally…

Since we were talking about Among Us earlier in this very newsletter - of course somebody has modded the actual Mrs. Pac-Man NES ROM to be all about those lovable spacemen.

“You need to dodge the crewmates in various locations around The Skeld in order to avoid being ejected and surviving to win the round!” You know you’ve got a monster hit when stuff like this happens:

[This newsletter is handcrafted by GameDiscoverCo, a new agency based around one simple issue: how do players find, buy and enjoy your premium PC or console game? We’ll be launching a ‘Plus’ paid newsletter tier with lots of extra info/data - watch out for it soon.]